City Council approves ordinance to hold banks responsible for blighted homes in default process

Jeralynn Blueford addresses the city council on Tuesday evening, as family members look on as they hold photos of Alan Blueford, who was shot and killed by police May 5.

The city of Oakland has a program that charges fines for banks that fail to maintain blighted homes that have been foreclosed upon that the bank now owns. On Tuesday night, the city council voted unanimously to expand those controls to include homes going through the default process.

The new ordinance was necessary to address residential properties stuck in a “no man’s land” —the period of time after a homeowner receives a notice of default but before the bank has moved in to foreclose—said the legislation’s author, Councilmember Jane Brunner (District 1).

Brunner said the city’s initial program, which starting in 2010 forced banks to register any foreclosed properties or incur a $5,000 fine, has helped hold banks accountable for maintaining blighted properties. But homes that have been abandoned after a foreclosure, especially in the flatlands of East and West Oakland, have become eyesores and crime magnets that bring down the rest of the neighborhood, according to the city staff report presented at the meeting.

Brunner said taking care of those properties should be the responsibility of the bank once it’s clear the tenant has vacated. Brunner said that process could take “weeks, months, years” for the bank to move in and take ownership of the property.

“We know that in a huge amount of properties, they’re not only blighted, with grass and roofs caving in, but many in poor neighborhoods are boarded up,” Brunner said. “So this is critical.”